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Some Economic Implications of Minimum Pricing: The Case of Wine Grapes in Australia

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  • O'Mara, L. Paul

Abstract

Minimum pricing arrangements for grapes taken up by wineries in Australia arc briefly reviewed. A partial equilibrium model is developed to illustrate the implications of such arrangements for income transfers and dead-weight losses in both the grape and wine markets. An attempt is made to incorporate the contingencies of the long lead times associated with grape production and the possible occurrence of monopsonistic behaviour by wineries. The analysis is theoretical, so that, while directed specifically at the wine grape industry in Australia, much of it is relevant to other instances of minimum pricing for agricultural commodities.

Suggested Citation

  • O'Mara, L. Paul, 1981. "Some Economic Implications of Minimum Pricing: The Case of Wine Grapes in Australia," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 49(02), pages 1-18, August.
    • Handle: RePEc:ags:remaae:12427
    DOI: 10.22004/ag.econ.12427
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    Keywords

    Demand and Price Analysis;

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